July 26 - Britain's Lloyds Banking Group has received subpoenas from government agencies investigating the global interest rate rigging scandal. Hayley Platt reports
Last week it was forced into a cut-price sell off of more than 600 high street branches, this week Lloyds Bank has been drawn into the Libor scandal. Units of the bailed out bank have received subpoenas from government agencies investigating manipulation of interbank lending rates. Earlier this month U.S. and UK regulators fined Barclays more than $450 million dollars for rigging rates. More than a dozen other banks are being investigated and more fines are expected. Michael Ingram from BGC Partners says it's bad news for the British tax payer which owns 40 percent of Lloyds. SOUNDBITE: Michael Ingram, BGC Partners, saying (English): "How this is handled has got to be seen to be fair and above board. It has to be quite transparent. Obviously any bank in which the state has a stake which then has to take a hit is bad news." Lloyds posted a statutory pre-tax loss of 439 million pounds in the first half, beating expectations- just. Margins remained stable, while bad debts fell. But the bank has had to increase its pot for mis-selling payment protection insurance. SOUNDBITE: Michael Ingram, BGC Partners, saying (English): "I actually think on an underlying basis they were slightly a miss but obviously on the headline number it was really impacted by this extra £700 million pounds of provisions against PPI and this was really unexpected because Lloyds had already made something like £3.6 billion in provisions which was way more than pretty much all the rest of the UK banks put together." The bank says claims have started to fall but it can't rule out further provisions. Hayley Platt, Reuters.